Gold Prices Reclaim $1,800, Silver Surges to Trim Weekly Loss

U.S. gold prices rallied Friday to close higher for the first time in three days, retuning to above $1,800 an ounce after giving up the milestone Thursday for the first time since August 29.

"You don’t want to go into the weekend short on gold," MarketWatch quoted Matt Zeman, head trader and strategist at Kingsview Financial in Chicago. "People would rather be safe than sorry."

Gold prices advanced $33.30, or 1.9 percent, to close at $1,814.70 an ounce in the December futures contract on the Comex in New York. Prices traded from $1,765.40 to $1,825.00.

On the week, however, gold prices dropped 2.4 percent. Prices were pounded Thursday after the European Central Bank said it would coordinate with other central banks to lend dollars to stem the credit crisis. Since, a bit of optimism gave way and gold bargain-hunting ensued.

"They’re only really geared to put out spot fires and play brinkmanship, rather than to deliver a killer package that will actually resolve all their issues," Tom Price, an analyst at UBS AG, said by telephone from Sydney, according to Bloomberg. "In that environment, the problem drags on for years, not months, and it’s a great environment for gold."

Forecasts are for lower gold prices next week, according to the weekly gold survey conducted by Kitco News.

"Weakness in technical charts in the short term and investors returning to other, riskier markets like equities could weigh on gold prices next week, according to participants in the Kitco News Gold Survey.

In the Kitco News Gold Survey, 28 out of 34 participants responded. Of those 28 participants, nine see prices up, while 15 see prices down and four see prices sideways or unchanged. Market participants include bullion dealers, investment banks, futures traders and technical chart analysts.

Those who see lower prices for next week cite both the resurgence in the U.S. dollar and technical chart patterns…"

Gold this week cut away a portion of its gains, but the yellow metal still stands 27.7 percent higher in 2011.

Weekly Losses in other Precious Metals Futures

In New York futures closings Friday and in precious metals advances for 2011:

Silver prices for December delivery surged $1.330, or 3.4 percent, to settle at $40.831 an ounce. Prices ranged between $39.455 and $40.985. Silver holds the number one spot as the best performing precious metal with its year-to-date gain of 32.0 percent.

Platinum matched the dollar and percent increases of gold, advancing $33.30, or 1.9 percent. Platinum prices for October delivery closed to $1,813.90 an ounce, trading between $1,770.00 and $1,820.00. Platinum has advanced 2.0 percent in 2011.

Palladium prices for December delivery advanced $9.45, or 1.3 percent, to settle at $732.95 an ounce, trading from $720.05 to $741.80. Palladium has sunk 8.8 percent this year.

Palladium had led precious metals in percent losses last week. Not this one. Although it still registered a weekly loss, it was mildest at 0.8 percent as compared to dips in silver of 1.9 percent and platinum at 1.3 percent.

London Precious Metals Prices

Precious metals in London were mixed. In London Fix price comparisons between Friday (PM) and Thursday (PM):

Gold prices advanced $12.00 to $1,794.00 an ounce,

Silver declined 37.0 cents at $39.97 an ounce,

Platinum gained $6.00 to $1,798.00 an ounce, and

Palladium rose $16.00 at $732.00 an ounce.

The metals measured weekly losses of 3.1 percent for gold, 3.5 percent for silver, 2.4 percent for platinum and 2.1 percent for palladium.

U.S. Mint Bullion Coin Weekly Sales

Sales of U.S. bullion coins were nearly muted Friday, based on the latest U.S. Mint sales figures. The single gainer was the American Silver Eagle, rising 75,000. That was enough to lift its sales to over 1 million for September — a month that is proving to be, so far, one of the slowest of the year for the .999 fine silver coins. The Silver Eagle weekly total was 392,000 versus the previous 577,000.

*The Gettysburg and Glacier America the Beautiful Five Ounce Silver Bullion Coins are sold out. Unlike other investment-grade products, the United States Mint does not provide daily per coin sales totals for the Olympic, Vicksburg, and Chickasaw America the Beautiful Five Ounce Silver Bullion Coins. The individual totals are as of Friday, September 2, while the combined total is as of Monday, September 12.